Britain And Iran Restore Ties

London Denies Deal To Free Hostages Held In Lebanon

LONDON — Britain and Iran restored full diplomatic relations Thursday, leaving the United States as the only major nation with no direct ties with Tehran.

The Foreign Office denied that the agreement to restore relations was part of a deal to win freedom for three British hostages in Lebanon. But Foreign Secretary Sir Geoffrey Howe said it might help.

``That will help press the case we have to press anyway for British subjects, whether in Iran or elsewhere,`` Howe said. He said he hoped two Britons, held for a year in Tehran jails without trial, might be released soon.

The three British hostages in Lebanon, believed to be held by pro-Iranian groups, are Church of England envoy Terry Waite, journalist John McCarthy and Belfast teacher Brian Keenan. All have been held about two years.

The end of Iran`s war with Iraq has seen a flurry of diplomatic activity from Tehran, as the regime there moves to end its international isolation.

Diplomatic relations have been restored with Canada and France and upgraded with Kuwait and Bahrain. Iran has even talked of restoring relations with Saudi Arabia, its archrival in the Persian Gulf and within the Organization of Petroleum Exporting Countries.

Hashemi Rafsanjani, speaker of the Iranian parliament, has said that Iran is ``abandoning a policy of constantly making enemies.``

But the United States remains ``the great Satan`` of Iranian diplomacy. The election of George Bush as president did not produce an olive branch from Tehran.

The United States broke relations with Iran after the U.S. Embassy was seized and diplomats were held hostage for more than a year. Iranian assets in the United States were frozen at that time by President Jimmy Carter;

The British Embassy in Tehran has been closed since 1980, after demonstrators damaged it. But the rupture in relations came in June, 1987, after an Iranian diplomat was arrested for shoplifting in Britain and militants kidnaped and beat a British diplomat in Tehran.

``The central bargain,`` Howe said, ``is that both sides treat each other properly, and move down the normal road of getting back to normal relations.`` Each nation will send 16 diplomats to the other`s capital, with ambassadors expected to be exchanged by next spring.